strategic management concepts and cases 9e l.
Download
Skip this Video
Loading SlideShow in 5 Seconds..
Strategic Management: Concepts and Cases 9e PowerPoint Presentation
Download Presentation
Strategic Management: Concepts and Cases 9e

Loading in 2 Seconds...

play fullscreen
1 / 29

Strategic Management: Concepts and Cases 9e - PowerPoint PPT Presentation


  • 145 Views
  • Uploaded on

Strategic Management: Concepts and Cases 9e. Part I: Strategic Management Inputs Chapter 2: The External Environment: Opportunities, Threats, Industry Competition and Competitor Analysis. The Strategic Management Process.

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about 'Strategic Management: Concepts and Cases 9e' - solada


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
strategic management concepts and cases 9e

Strategic Management: Concepts and Cases 9e

Part I: Strategic Management Inputs

Chapter 2: The External Environment:

Opportunities, Threats,

Industry Competition and

Competitor Analysis

slide3
Chapter 2: The External Environment: Opportunities, Threats, Industry Competition and Competitor Analysis
  • Overview: Seven content areas
    • The firm’s external environment
    • General and industry environment
    • External environment analysis process activities
    • General environment segments
    • Porter’s 5 Competitive Forces
    • Strategic groups: Definition and influence
    • Competitor Analysis: Intelligence and ethics
effects of external environment philip morris international pmi
Effects of External Environment: Philip Morris International (PMI)
  • Largest international market share and leading company in 11 of top 30 cigarette markets
  • Implementing strategies in anticipation of future external environmental conditions
    • Working with foreign governments on regulatory framework
    • Opportunities in emerging markets
    • Smokeless tobacco in anticipation of fewer smokers
    • Support of sustainable farming
    • Waste reduction in manufacturing
slide5
Chapter 2: The External Environment: Opportunities, Threats, Industry Competition and Competitor Analysis
  • Overview: Seven content areas
    • The firm’s external environment
    • General and industry environment
    • External environment analysis process activities
    • General environment segments
    • Porter’s 5 Competitive Forces
    • Strategic groups: Definition and influence
    • Competitor Analysis: Intelligence and ethics
external environment general industry and competitor
External Environment: General, Industry and Competitor
  • Three External Environments include:
    • General
    • Industry
    • Competitor
external environment general industry and competitor cont d
External Environment: General, Industry and Competitor (Cont’d)
  • The General Environment
    • The broader society dimensions that influence an industry and the firms within it
    • Grouped into 7 dimensions OR ‘environmental segments’ Each segment composed of elements
external environment general industry and competitor cont d9
External Environment: General, Industry and Competitor (Cont’d)
  • Industry Environment
    • Set of factors directly influencing
      • A firm’s competitive actions/responses
      • Relates to Porter’s 5 Forces – see upcoming slides
      • Competitor analysis: gather and interpret competitor information
  • Competitor Environment
    • Gives details about
      • A firm’s direct and indirect competitors
      • The competitive dynamics expected to impact a firm's efforts to generate above-average returns
slide10
Chapter 2: The External Environment: Opportunities, Threats, Industry Competition and Competitor Analysis
  • Overview: Seven content areas
    • The firm’s external environment
    • General and industry environment
    • External environment analysis process activities
    • General environment segments
    • Porter’s 5 Competitive Forces
    • Strategic groups: Definition and influence
    • Competitor Analysis: Intelligence and ethics
external environment analysis
External Environment Analysis
  • Opportunity
    • General environment condition that, if exploited, helps a company achieve strategic competitiveness
  • Threat
    • General environment condition that may hinder a company's efforts to achieve strategic competitiveness
external environment analysis cont d
External Environment Analysis (Cont’d)
  • 4 components of External Environment Analysis
    • Scanning
    • Monitoring
    • Forecasting
    • Assessing
slide13
Chapter 2: The External Environment: Opportunities, Threats, Industry Competition and Competitor Analysis
  • Overview: Seven content areas
    • The firm’s external environment
    • General and industry environment
    • External environment analysis process activities
    • General environment segments
    • Porter’s 5 Competitive Forces
    • Strategic groups: Definition and influence
    • Competitor Analysis: Intelligence and ethics
segments of the general environment
Segments of the General Environment
  • 7 Segments
    • Demographic
    • Economic
    • Political/Legal
    • Sociocultural
    • Technological
    • Global
    • Physical Environment
slide15
Chapter 2: The External Environment: Opportunities, Threats, Industry Competition and Competitor Analysis
  • Overview: Seven content areas
    • The firm’s external environment
    • General and industry environment
    • External environment analysis process activities
    • General environment segments
    • Porter’s 5 Competitive Forces
    • Strategic groups: Definition and influence
    • Competitor Analysis: Intelligence and ethics
industry environment analysis
Industry Environment Analysis
  • Industry
    • Definition: Group of firms producing products that are close substitutes
    • Industry environment, in comparison to the general environment, has more direct effect of firm’s
      • Strategic competitiveness and
      • Above-average returns
    • Intensity of industry competition and industry’s profit potential are a function of 5 forces (See next slide)
industry environment analysis cont d
Industry Environment Analysis (Cont’d)
  • Porter’s 5 Forces
    • 1/5: New entrants
      • Can threaten market share of existing competitors
      • May bring additional production capacity
      • Function of two factors
        • 1: Barriers to entry
          • Economies of scale
          • Product differentiation
          • Capital requirements
          • Switching costs
          • Access to distribution channels
          • Cost disadvantages independent of scale
          • Gov’t policy
        • 2: Expected retaliation
industry environment analysis cont d19
Industry Environment Analysis (Cont’d)
  • Porter’s 5 Forces
    • 2/5: Bargaining power of suppliers
      • They are powerful when …
        • 1. Few large companies and more concentrated than the
        • industry to which they sell
        • 2. No substitutes
        • 3. Industry firms not significant customer to supplier gp
        • 4. Supplier’s goods are critical to buyer’s success
        • 5. High switching costs due to effectiveness of supplier’s products
        • 6. Threat of forward integration
industry environment analysis cont d20
Industry Environment Analysis (Cont’d)
  • Porter’s 5 Forces
    • 3/5: Bargaining power of buyers
      • They are powerful when …
        • 1. Purchase large portion of industry’s total output
        • 2. Product sales accounts for significant seller annual revenue
        • 3. Low switching costs (to other industry product)
        • 4. Industry products are undifferentiated or standardized and
        • threat of backward integration
industry environment analysis cont d21
Industry Environment Analysis (Cont’d)
  • Porter’s 5 Forces
    • 4/5: Threat of substitute products
      • Goods or services outside of given industry perform same or similar functions at a competitive price (i.e., plastic has replaced steel in many applications)
    • 5/5: Intensity of Rivalry Among Competitors
      • Numerous or equally balanced competitors
      • Slow industry growth
      • High fixed costs or high storage costs
      • Lack of differentiation or low switching costs
      • High strategic stakes
      • High exit barriers
industry environment analysis cont d22
Industry Environment Analysis (Cont’d)
  • Porter’s 5 Forces
    • 5/5: Intensity of Rivalry Among Competitors
      • High exit barriers (Cont’d)
        • 1. Specialized assets
        • 2. Fixed costs of exit (i.e., labor agreements)
        • 3. Strategic interrelationships (i.e., one business depends on another)
        • 4. Emotional barriers (i.e., loyalty to employees, etc.)
        • 5. Government and social restrictions
slide23
Chapter 2: The External Environment: Opportunities, Threats, Industry Competition and Competitor Analysis
  • Overview: Seven content areas
    • The firm’s external environment
    • General and industry environment
    • External environment analysis process activities
    • General environment segments
    • Porter’s 5 Competitive Forces
    • Strategic groups: Definition and influence
    • Competitor Analysis: Intelligence and ethics
strategic groups
Strategic Groups
  • Strategic Groups
    • Set of firms emphasizing similar strategic dimensions to use a similar strategy
    • Implications
      • Because firms within a group compete (offer similar products) rivalry can be intense – the greater the rivalry the greater the threat to each firm’s profitability
      • Strengths of the 5 forces differs across strategic groups
      • The closer the strategic groups, in terms of strategy, the greater the likelihood of rivalry
slide25
Chapter 2: The External Environment: Opportunities, Threats, Industry Competition and Competitor Analysis
  • Overview: Seven content areas
    • The firm’s external environment
    • General and industry environment
    • External environment analysis process activities
    • General environment segments
    • Porter’s 5 Competitive Forces
    • Strategic groups: Definition and influence
    • Competitor Analysis: Intelligence and ethics
competitor analysis
Competitor Analysis
  • Competitor analysis and organization response:
    • What drives competitors
      • Shown by organization's future objectives
    • What the competitor is doing and can do
      • Revealed in organization's current strategy
    • What the competitor believes about the industry
      • Shown in organization's assumptions
    • What the competitor’s capabilities are
      • Shown by organization's strengths and weaknesses
competitor analysis cont d
Competitor Analysis (Cont’d)
  • Competitor intelligence
    • Set of data and information the firm gathers to better understand and anticipate competitors' objectives, strategies, assumptions, and capabilities
intelligence collection cont d
Intelligence Collection (Cont’d)
  • Follow ethical practices when gathering competitor intelligence
    • Obtain public information
    • Attend trade fairs and shows and collect brochures, view exhibits, listen to their discussions
  • Some practices may be legal, but unethical
  • Unethical tactics can include
    • Blackmail
    • Trespassing
    • Eavesdropping
    • Stealing drawings, samples or documents